Notwithstanding a few concerns, the pposition People’s Progressive Party/Civic (PPP/C) threw its support behind the government-sponsored Credit Reporting (Amendment) Bill 2015. The bill received the full support of the House on Thursday when it was presented for a second reading by Finance Minister Winston Jordan. Four articles within the Principal Act of 2009 have been amended: Article 11 (Permissible Purpose), Article 12 (Credit Information Providers), Article 13 (Consent) and Article 14 (Data Quality).

In presenting the bill, Finance Minister Winston Jordan explained that the amendments to the Principal Act are aimed at creating a legal framework, which will enable the Credit Bureau to operate effectively within the market while ensuring that financing institutions and borrowers benefit from an efficient credit-reporting industry.
“The strengthening legislation will… mandate regulated credit information providers to upload credit information to the licensed credit bureau,” he added, noting too that utility companies will also be mandated to upload credit information to the licensed credit, providing the government is the majority owner.
Additionally, it requires credit information providers to obtain the consent of data subjects prior to submitting the request to the Credit Bureau with a few to obtain credit information. However, it also authorises credit information providers to upload credit information to the licensed credit bureau without the consent having to be given by the data subject.
“Credit Bureaus are essential elements of a country’s financial infrastructure, they increase access to credit, they support responsible lending and the produce credit losses,” Jordan posited, noting that “an efficient functioning Credit Bureau in Guyana will allow for a broader and a fuller access to credit and will support responsible lending, while reducing credit losses. It will also help in stabilising the financial sector.”
SAFEGUARD CONSUMERS
Minister of Business Dominic Gaskin, in renewing his support for the bill, said the amendments will also help to safeguard the rights of consumers.
Former Housing Minister Irfaan Ali signalled the opposition’s support for the amendments, but maintained the processes should not be mandatory, opining, however, that the amendments do not speak to mandatory processes.
“I agree with the minister that in a modern financial system… it is necessary that we have the enabling legislative framework that would allow us to compete and function at an efficient level. But that legislative framework can only give us the results if we have the necessary infrastructural framework, institutional framework to back the legislative framework,” Ali to the House.
According to him, the Finance Minister in putting the amendments before the House, is seeking to make the Credit Reporting System mandatory, but opined that the proposed amendments do not cater for any mandatory framework.
“We have a voluntary system, we are now moving to a mandatory system but when I look at the amendments, none of the amendments here point to a mandatory system,” he pointed out.
BUREAUCRACY
However, Ali said, “I am in support of these amendments, but I do not think that another layer of bureaucracy should be imposed… at this time. And I don’t think Mr Speaker, that a mandatory credit report will absorb the issue.”
Alluding to the use and dissemination of credit information, the former Housing Minister said the information would only be relevant if it [is] factually correct. He said in the existing billing system there exist many difficulties with respect to the utility services, pointing out that oftentimes estimated bills are used, while in other cases bills are challenged by consumers.
He said if the information is utilised to rate consumers based on the credit information reported, there is a possibility that the information may not be accurate. The PPP/C parliamentarian also questioned the cost implication of implementing such a system.
His colleagues Joseph Hamilton and Leader of the Opposition Bharrat Jagdeo also endorsed the amendments but with caution. “We support any legislation that will see a properly functioning Credit Bureau,” Jagdeo told the House. However, he expressed concerns over the likely transactional costs that would be added while using the opportunity to caution the Government against taking the various indices being published on Guyana as the single truth. In response to the concerns raised by the opposition, the Finance Minister said there is scope for review, but said development comes at a cost. (smarshall@guyanachronicle.com)
By Svetlana Marshall